Radiation levels in the abandoned communities near Fukushima Daiichi nuclear power plant have fallen 40% in the past year. Inside the wrecked facility, construction workers rush to complete state-of-the-art equipment that will remove dozens of dangerous radioactive nuclides from cooling water. Soon, a steel shield will be driven into the seabed to prevent contamination from the plant from leaking into the Pacific Ocean.

Almost two years after a deadly tsunami crashed into the plant, crippling its backup power supply and triggering the world's worst nuclear crisis for a quarter of a century, the gravest danger posed by Fukushima Daiichi has passed.

The pipes, cables and other equipment strewn across the plant's grounds this time last year are now functioning components in a complex, technologically fraught mission to cool the crippled reactors, while experts struggle to figure out how to extract the melted nuclear fuel lying deep inside their basements.

The three reactors struck by meltdown and hydrogen explosions two years ago were brought to a safe state known as "cold shutdown" in December 2011, nine months after the tsunami left almost 20,000 dead or missing along Japan's north-east coast.

Now, Japan is about to embark on a clean-up that could cost at least $100bn – on top of the cost of compensating evacuees and decontaminating their abandoned homes.

Fukushima Daiichi's manager, Takeshi Takahashi, conceded that decommissioning the plant could take 30 to 40 years.

"Even though we are still faced with a difficult task, we'll keep pushing on with the decommissioning process," he told a small group of visiting foreign journalists on Wednesday. "It will take a long time to complete our work, especially on the three reactors that suffered meltdown, but we'll do our best to keep them stable."

The clean-up operation will begin at building No 4, where the fuel rods inside survived unscathed after it was hit by the tsunami, then badly damaged by a hydrogen explosion.

By the end of this year, Tokyo Electric Power Company (Tepco) says it will begin removing fuel assemblies from the reactor building's storage pool and placing them in a nearby cooling pool, where they will remain for four years before being stored in even safer dry casks in a purpose-built facility on higher ground.

In total, workers will have to extract more than 11,000 new and used fuel assemblies from seven badly damaged storage pools. Work to remove melted fuel won't begin until 2021, and the entire decommissioning project is expected to take up to 40 years.

Managers from firms contracted by Tepco to help decommission the 40-year-old plant say they are confident progress is being made, despite the radiation hazards faced by their employees.

Perhaps the most dangerous job on the site has fallen to Hiroshige Kobayashi and his colleagues. As a manager at Kajima Corp, Kobayashi is responsible for clearing and processing the rubble and debris from reactor No 3, where radiation levels easily outstrip those at other parts of the site.

On the ocean side of neighbouring reactor No 4, where a meltdown did not occur, Tepco recently measured radiation at 172 microsieverts/hour; but in the same area outside reactor No 3, levels soar to 1,710 microsieverts/hour. By comparison, a chest X-ray is equivalent to 50 microsieverts and a return flight between Tokyo and New York 200 microsieverts, according to the Japan Atomic Energy Agency.

The dangers associated with working in highly radioactive areas of Fukushima Daiichi prompted the World Health Organisation (WHO) to warn last week that one-third of the plant's workers face an increased risk of developing thyroid cancer, leukaemia and all solid cancers during their lifetimes.

Kobayashi declined to comment on the WHO report, but acknowledged that workers face unprecedented danger from persistently high radiation levels.

"It's a fact that the levels in reactor No 3 are very high, so we are trying to deal with that by using remote control technologies and staying as far away from the reactor as possible," he said.

Hopes that robots would quickly be able to reach areas of the plant inaccessible to humans suffered a setback when Quince, a $6m robot, lost contact with its operators while monitoring inside one of the reactors in October 2011.

"We're in a situation where we're using technologies we've never experienced before, such as GPS and lasers when we're dealing with the debris," Kobayashi said.

Although Tepco has managed to insert remote-controlled cameras into the damaged reactors' outer vessels, it is still no closer to gauging the state of the damaged fuel – a prerequisite for removing it.

To add to Tepco's troubles, irradiated water is increasing at such a pace that the utility is running out of space for the tanks it needs to store it.

Several strong quakes have shaken north-east Japan since 11 March 2011, but Takahashi insisted that the reactor No. 4 building – where 1,500 fuel assemblies stored in a pool on the top floor have drawn concern because of their vulnerability to seismic activity – could withstand an earthquake of similar intensity to the one that destroyed the plant two years ago.

Despite those reassurances, Takahashi conceded that the plant has become the focal point of a nuclear crisis whose victims, like the facility itself, are a long way from returning to any semblance of normality.

On the drive through the 20-kilometre evacuation zone to Fukushima Daiichi, visitors pass entire villages that remain frozen in time. Half a dozen cars sit abandoned in a supermarket car park, shops and restaurants lie deserted, and thousands of black bags filled with contaminated soil and grass cover fields once used to grow rice, while authorities decide how, and where, to dispose of them.

The only movement comes from lorries carrying equipment and building materials, and buses ferrying workers in protective blue and white clothing to and from the plant.

Meanwhile, the tens of thousands of residents who once called this forbidding landscape home still have no idea when, or if, they will be able to return.

Repeating Tepco's mantra of the past two years, Takahashi apologised "to the world" for the "inconvenience" caused by the Fukushima Daiichi nuclear disaster. While he shared his colleagues' optimism over decommissioning, it was tinged – as his surroundings demand – with realism.

"It will be a long time before this power plant becomes a part of history," he said.